How One ENS Vote Reignited the DAO Governance Debate: Uneasy Money

**Nick Johnson** (0:00)
I want to believe that we can still act as a safeguard for the protocol. It can still make the right decisions without the noise of constantly trying to allocate individual pools of money and run working groups and so on. You know, focused on the right things, I want to believe it can still work. My conviction is weaker than it was. I want to make a real effort to turn this round and to focus on the things that matter and to re-decentralize it. If it doesn't work, then we need to find another path forward that still is meaningfully decentralized. And maybe it's going to be a conversation going forward, trying to figure out, you know, can we make this work in this way, still with token-weighted governance? If we can't, how can we make it work in a really meaningfully decentralized fashion? You know, I don't want to become ICANN, not because ICANN is evil or anything, but because I got into crypto the whole, you know, for the whole reason that we should be able to build better decentralized governance structures.
And I don't want to give up on that just yet.

**Kain Warwick** (0:58)
Hey, everyone, I'm Kane Wark and welcome to Uneasy Money feels what happens on chain never stays on chain. I'm here with my co-host, Taylor Monahan, security expert and we have two very special guests today. Nick Johnson, the founder of ENS Labs and the current villain on crypto Twitter timeline. We'll get to the bottom of that. And Alex Van de Sande, another Ethereum super OG.
I've been out ethoged by like a fair margin today.
I'm like the LARPy new guy in this room right now, who built ENS back in 2017 but now does other things. So first, before we begin, here's a word from the sponsors that make the show possible.

**SPEAKER_3** (1:41)
This episode is brought to you by Cape, America's privacy first mobile carrier.
Same premium service you'd expect from the other carrier, but designed so your number, your location and your data actually stay yours. Get 33 percent off six months at cape.co.unchained.

**Kain Warwick** (2:05)
All right. Our first segment is ENS's Security Council War.
Well, let's dig in to this because it has been probably the last two or three days now, back-to-back Twitter coverage.
The ENS DAO Security Council, the body that can cancel a proposal after it's been passed and entered the time lock, an emergency backstop against governance attacks, was up for a two-year renewal. The current date expires July 24th, the on-chain renewal failed. Nick.Eath, that is this gentleman, is with us here with the glasses. ENS Labs founder voted against with 3.26 million ENS, roughly 50 percent of the active voting supply. Now, I just want to stop there because I've seen on Twitter many hyperbolic statements about you voted with half of the tokens. Everyone seems to be very confused about this. So can we just at least address, do you currently control 50 percent of the ENS tokens?

**Nick Johnson** (3:15)
No.

**Kain Warwick** (3:16)
Is that okay?

**Nick Johnson** (3:17)
All right.

**Kain Warwick** (3:18)
So what is the voting proportion at the moment in ENS typically?

**Nick Johnson** (3:26)
So there's 100 million ENS tokens. At launch, 50 percent of those went to the DAO, 25 percent went to an airdrop, and 25 percent went to core contributors.
As of today, of course, everything is mixed about, the DAO still mostly has its 50 percent. I have about 3.2 percent of the total, and the remainder is distributed amongst a great deal, great number of holders. The actual amount that are delegated is about 7 million.

**Kain Warwick** (4:00)
And so, just to be clear, you've delegated all of your tokens to yourself.

**Nick Johnson** (4:04)
Almost all of them.

**Kain Warwick** (4:06)
That's quite a draconian move for you to give yourself the voting power there of your own tokens. But I'm kidding. So you have 3 percent of the token supply, right? That is voting, which was roughly 50 So about 6 percent, let's call it 6, 7 percent of the tokens are being actively used for voting, which is broadly in line with other DAOs, maybe even high potentially. So the fundamental issue here obviously being that there is very little participation by token holders in DAO governance here. There are more than enough tokens to outvote you clearly, like in the world, right?
Theoretically.

**Nick Johnson** (4:59)
And I think what emphasizes that is that at launch, of course, I had my launch allocation, which was just shy of 7%. And my influence, had I ever delegated that, would actually have been less than it was today, because delegated voting power and participation has diminished more quickly than my own token buy, you know, because everybody is selling tokens and is moving away because mostly because there's strong financial incentive to sell something you got, especially if you got it for free, and none to participate in decentralized governance.